The New York Times on Saturday published an in-depth investigative report about retail company J.C. Penney’s seemingly amazing organic search results. For a wide variety of product category keywords, JC Penney was appearing number 1 in the organic results area. It was even besting some websites of product manufacturers. And all of this was happening during the holiday season, which is one of the most important times for online retailers.

Unfortunately, not all was as it seemed. With the help of a SEO firm, the Times discovered that the Penney website was benefiting from a black-hat paid link scheme. Many of the links were coming from unrelated, “spammy” sites with just the perfect anchor text. Penney is denying they had any knowledge and has since fired their SEO firm SearchDex, and some of the links appeared to have been created through a site called TNX.net. The scheme is probably more complex than what the Times discovered, but it’s a great reminder for small business website owners to be more proactive and diligent in their online efforts:

If you’re completely new the concept of SEO, read through Google’s own beginner’s guide to Search Engine Optimization. It contains all the basics including how to promote your site the right way.

Sign up for Google Webmaster Tools. Use it to track how search engines are viewing your site and see inbound links pointing to your site. Bing also offers a similar product, and both are essential in proactive site management.

If a SEO agency handles your optimization efforts or are looking for one, be sure that they are credible and transparent with their link building efforts. If it’s true that JC Penney didn’t know SearchDex was participating in black-hat efforts, then they didn’t do their due diligence.

Another reason to stay pro-active in your site and monitoring inbound links, is that it’s plausible that your competitors could sign up for these spam link schemes and send the links directly to your site. If your site is caught and penalized like JC Penney, your competitors come out on top. According to the article, on Feb. 1 JC Penney has an average organic ranking of 1.3. On February 8 it was down to average position 4, and just 2 days later it was 52 (6 pages deep in Google’s search results!). Large, multi-national companies have other revenue streams that could make up for penalized search results for a while. But for small businesses owners, oversights like that could lead to huge ramifications.